Mumbai, 09 Dec (Commoditiescontrol): ICE cotton futures ended the week on a weak note, marking a 2.3% decline in the benchmark March contract to settle at 70.11 cents per pound on Friday. This drop erased gains made in the prior week, driven by weaker export sales data, unfavorable external market conditions, and a strengthening U.S. dollar. Despite the losses, the March contract managed a modest 10-point gain over the month of November, reflecting some resilience in underlying fundamentals.
Export sales were a primary factor weighing on prices. Weekly commitments for the week ending November 28 dropped to 170,663 running bales (RB), a sharp decline from the marketing year's peak a week earlier. Shipments, while totaling 157,546 RB—the third-highest this season—remain below USDA's average pace, standing at 65% of the annual forecast compared to the typical 71%. Key buyers included Vietnam and Pakistan, which purchased 84,300 RB and 36,700 RB, respectively.
October Census data offered some positive news, showing cotton shipments (excluding linters) reaching 573,156 bales—a 14% increase from September and a 45% rise year-on-year, achieving a four-year high for October.
External pressures further dampened the market. The U.S. dollar index rose by 249 points, and crude oil prices fell by $1.13 per barrel, adding to bearish sentiment. Speculative activity reflected limited investor confidence, with managed money trimming net short positions to 16,383 contracts.
From a technical perspective, the March contract traded below key moving averages, signaling continued weakness. Analysts identified support at 69.73 and 69.35 cents, with resistance at 70.82 and 71.53 cents. Traders anticipate ongoing volatility amid subdued demand from major importers like China and heightened global competition>
While the broader market struggles with headwinds, November's modest gain in the March contract hints at the potential for stability. However, the market remains focused on improving demand dynamics and policy updates to chart a more definitive course in the weeks ahead.
(By Commoditiescontrol Bureau: 09820130172)
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